Is Itan required to provide prior notice before conducting an inspection of my Itan Salon?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
We may conduct inspections at any time without prior notice. During the inspection, we (or our representative) will use reasonable efforts to minimize any interference with the operation of your Salon. You and your employees must cooperate and not interfere with the inspection. You consent to us accessing your Technology Systems and retrieving any Business Data we deem appropriate. You must reimburse us for all Travel Expenses and other costs we incur to conduct an inspection to determine if you remedied a: (a) health or safety issue identified by a Governmental Authority; or (b) breach of system standards we bring to your attention. We bear the cost of all other inspections.
16.2. Audit. We may audit your books and records at any time. You must fully cooperate with us and any Person we hire to conduct the audit. If an audit reveals an understatement of Gross Sales, you must immediately pay us all additional fees you owe together with any late fee imposed pursuant to §13.4. You must reimburse us for the cost of any audit (including reasonable accounting and attorneys' fees and Travel Expenses incurred by us or the auditor) that: (a) is required due to your failure to provide information we request, preserve records or file reports as required by this Agreement; or (b) reveals an understatement of Gross Sales by at least 3%. We bear the cost of all other audits. Your reimbursement of our audit costs does not preclude us from terminating this Agreement.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, Itan is not required to provide prior notice before conducting inspections of your Itan Salon. Itan (or their representative) will try to minimize interference with the operation of your salon during the inspection. As a franchisee, you and your employees must cooperate with Itan and not interfere with the inspection.
As part of the inspection, you consent to Itan accessing your Technology Systems and retrieving any Business Data they deem appropriate. You must reimburse Itan for all Travel Expenses and other costs they incur to conduct an inspection if it is to determine if you remedied a health or safety issue identified by a Governmental Authority, or a breach of system standards they bring to your attention. Itan bears the cost of all other inspections.
Itan may also audit your books and records at any time, and you must fully cooperate with them or any person they hire to conduct the audit. If an audit reveals an understatement of Gross Sales, you must immediately pay Itan all additional fees you owe together with any late fee. You must reimburse Itan for the cost of any audit (including reasonable accounting and attorneys' fees and Travel Expenses) if it is required due to your failure to provide information, preserve records, or file reports as required by the Franchise Agreement, or if the audit reveals an understatement of Gross Sales by at least 3%. Itan bears the cost of all other audits. Your reimbursement of Itan's audit costs does not preclude them from terminating the Franchise Agreement.